The U.S. Navy is evaluating what to do with its headquarters in the Middle East after the Bahrain-based installation sustained damage during recent months of fighting with Iran.
For years, the Navy has managed its Middle East fleet operations out of Naval Support Activity Bahrain. Iranian forces began targeting the base after U.S. and Israeli forces launched strikes on Iran on Feb. 28.
“They blew the hell out of Bahrain,” acting Navy Secretary Hung Cao said in an interview with The Epoch Times on Sept. 9, as he concluded a visit to a shipyard in Philadelphia.
While open-source imagery had previously indicated the Bahrain naval base sustained damage, Cao’s comment marked a direct and official acknowledgement of the ongoing conflict’s impact on the facility.
Last month, following reports that the crew of the aircraft carrier USS Abraham Lincoln were facing strains after months supporting combat operations in the Middle East, the Navy told The Epoch Times that combat actions had disrupted traditional supply hubs in the region. Despite these disruptions, the service said the Lincoln’s crew maintained continuous access to clean water, healthy meal options, and functional air conditioning.
At a Navy town hall event on Aug. 31, a sailor who had been displaced from NSA Bahrain asked Chief of Naval Operations Adm. Daryl Caudle whether she would see the return of personal belongings she left on the base. Caudle said the service was working on a plan to reunite personnel with their belongings but said the service doesn’t plan to return to the base “anytime soon.”
When asked whether the Navy would need to repair NSA Bahrain in order to sustain its forces in the region, Cao said, “I have a task force that’s looking at that.”
The Iran conflict has fueled discussion over the continued utility of U.S. military outposts in the region.
Jim Webb, a U.S. Marine infantry veteran and independent national security consultant, said Cao’s latest comments suggest that the current U.S. force posture in the Middle East “is unsustainable without continuing to be under attack.”
“I don’t think there’s any way, you know, in the short, medium, or potentially even long term, that we can adequately defend a place like NSA Bahrain, or let alone the rest of the logistics bases there,” Webb told The Epoch Times.
Webb said keeping U.S. troops at bases in the region makes those troops “constant targets.”
In an interview with The Cipher Brief last month, retired Army Gen. David Petraeus similarly said the current U.S. military outposts in the region “are no longer viable.”
Petraeus previously led the U.S. Central Command (CENTCOM), which oversees U.S. military operations in the Middle East.
As he discussed the Iran conflict with The Cipher Brief, Petraeus said the current commander for U.S. forces in the region, Adm. Brad Cooper, has largely overseen recent combat operations from a distance, rather than from CENTCOM’s forward headquarters at the Al Udeid Air Base in Qatar.
“This is a result of the Iranians having capabilities they didn’t have before, in terms of the numbers of drones and the numbers of missiles with the range required to hold our facilities at risk and to strike them and to kill our soldiers and wound them,” Petraeus said.
Throughout the Iran conflict, U.S. forces have worked to reduce Iranian drones and missile launchers, and destroy storage and production facilities for those weapons. Still, U.S. forces have had to contend with these threats in recent clashes.
In the past week, U.S. forces reported striking 10 Iran-linked tankers in retaliation for Iranian missile attacks targeting U.S. warships.
President Donald Trump on Thursday evening addressed a crowd in Dallas, touting his administration’s achievements on the closing night of the two-day midterm convention and asking voters to back Republican candidates in the upcoming elections.
“I’m seeing spirit like we haven’t seen in this country for a long time, long time,” Trump said.
“But it came back about a year and a half ago. We went through four years of embarrassment, hurt, harm, sickness, filth was bad, but now it’s good, and it’s going to soon be greater than ever before, better than ever before.”
Trump laid out a flurry of proposals that he said Republicans would pursue in the coming two years.
First, Trump said that Republicans would make most-favored nation prescription drug discounts “permanent in law.”
He also mentioned the “No Invasion of Our Country Act,” a proposed bill from the president to make it illegal for future presidents to “open the border again.”
“We don’t want any more invasions of our country,” Trump said.
He also mentioned the related Safeguarding American Voter Eligibility (SAVE) America Act, which would require most Americans to present documented proof of U.S. citizenship to register to vote in federal elections.
Trump also vowed that with the help of Vice President JD Vance, “we will win the war on fraud,” and reiterated his past calls to end cash bail.
The speech is the capstone to a two-day meeting of Republicans in Dallas for their party’s first-ever midterm convention, with Trump placed at the center of what has been dubbed a “Trump-a-Palooza” by Republican organizers.
A flurry of key Republican-aligned policymakers, candidates, social media personalities, and political organizations have descended on the Texas metropolis, with a litany of additional events, candidate speeches, and organization activities also taking place across Dallas.
During the speech, Trump highlighted stock market gains under his second term, his administration’s efforts to lower drug prices, decreases in immigration, and other topics.
“Less than two years ago, the American people gave us a mandate to save America, and in 19 months, I’ve delivered on every single promise I made, and I think I delivered on far more,” he said.
Trump delivered his speech on Thursday shortly after Vice President JD Vance addressed the convention.
The president told the crowd near the beginning that he intended to speak less than he had the previous night, when he addressed the convention for more than two hours.
During that earlier speech, Trump described his second term as “the greatest two years in the history of the presidency,” urging voters to support Republicans in the upcoming elections.
Trump also promised voters a $5,000 dividend to every adult citizen if Republicans keep control of the Senate and House this November. Previously, the president had floated a $2,000 check stemming from tariff dividends.
After his administration faced questions about how it will actually carry out the proposal, Trump reiterated the promise during the second night.
“If we win the midterms, we will … provide a let’s call it Trump dividend: $5,000 for every adult citizen in our country,” he said.
Speaking to The Epoch Times at the convention ahead of Trump’s speech, Republican attendees criticized Democrats for what they called the democratic socialist pitch of “free things.”
Sisters Beth Mills of Shawnee, Oklahoma, and Colleen Robishaw of Arlington, Texas, told The Epoch Times that Republicans should tell people that nothing is free: Higher taxes would be needed to pay for free programs, and the government would exert more control over people’s lives.
“I think you need to look at the cost, the overall cost of what free things are. It was never free,” Mills said.
Nationwide, Republicans are facing difficult polling numbers across a variety of races.
Trump sits at 39.6 percent approval on RealClearPolling, compared with 57.1 percent who say they disapprove.
Following a handful of victories for candidates from the Democrats’ rising democratic socialist wing in largely blue-district races, Republicans have criticized the party as shifting too far left for the average American.
According to polling by Pew Research in July, Americans’ top concern at present is the economy, and by a wide margin. That poll found that economic issues were the driving political force this cycle for 29 percent of Americans.
Trump has described affordability, a key plank of his 2024 presidential campaign, as a “Democrat hoax.”
The president doubled down on this position during his remarks on the convention’s first night, calling affordability a “fake” issue, saying “I’m bringing the prices way down.”
The most recent Consumer Price Index report from the Bureau of Labor Statistics found that annual inflation in the U.S. currently sits at 3.4 percent for all items. That includes a roughly 25 percent increase in the cost of gasoline over the past year – especially after the Iran conflict started in late February and disrupted the global oil supply chain – while inflation on food items sits around 3 percent.
Some voters, meanwhile, told The Epoch Times that they don’t understand the fuss about affordability.
“It’s funny with the economy because, like, you know, under [President Joe] Biden it really wasn’t even talked about at all, and then Trump gets [in], and all of a sudden everyone’s talking about affordability,” convention attendee Rodney Stokes of Fort Worth, Texas, told The Epoch Times.
The second key motivating issue for Americans, according to Pew Research, is government ethics and reform, with 9 percent labeling this a top priority.
Meanwhile, 7 percent of Americans described immigration as a top issue for them. Healthcare, foreign policy, and Trump each polled at around 5 percent.
A federal appeals court on Sept. 9 questioned whether Louisiana, which has a near-total ban on abortion, has standing to force a nationwide return of in-person dispensing for abortion drug mifepristone, which patients can now obtain by telehealth and mail.
A medication abortion generally involves mifepristone, which blocks the hormone progesterone, and misoprostol, which induces contractions.
Louisiana says mifepristone can cause heavy bleeding and, in rare cases, life-threatening infection, and that the U.S. Food and Drug Administration (FDA) should bring back the pre-2023 rule requiring the drug to be dispensed in person at a clinic, office, or hospital. The state argues the Biden-era change, which allows a certified prescriber to order the pills by telehealth services and a pharmacy to mail them, skipped an adequate safety review and undercuts Louisiana’s abortion ban.
A panel of the U.S. Court of Appeals for the Fifth Circuit temporarily blocked the rule in May, but later that month the Supreme Court lifted that order, allowing the drug to continue to be dispensed through the mail.
The FDA, now under President Donald Trump, is currently reviewing safety claims about the drug.
If the state ultimately wins its ongoing lawsuit against the FDA to reinstate the requirement for in-person dispensing, demand for medication abortions, which now account for most abortions in the United States, could drop. This is because patients who currently obtain the medication through the mail without visiting a doctor would have to do more legwork to obtain it.
Louisiana has been challenging so-called shield laws in places such as California and New York that protect healthcare providers from out-of-state investigations and prosecutions. Louisiana has indicted out-of-state doctors for prescribing mifepristone to Louisiana residents.
But mifepristone continues to find its way into Louisiana.
Louisiana Solicitor General Ben Aguinaga told a newly constituted three-judge panel of the Fifth Circuit on Sept. 9 that the FDA rule undermines abortion bans enacted by his state and others after the Supreme Court overturned Roe v. Wade. That 2022 ruling held there was no constitutional right to abortion and returned regulation of the practice to the states.
“There’s no dispute that Louisiana is experiencing 1,000 abortions a month due to mifepristone mailed into the state,” Aguinaga said.
U.S. Circuit Judges Stephen Higginson and Dana Douglas asked whether the state had legal standing, or a close enough connection to the legal controversy, to sue over the FDA decision, saying Louisiana could not show that abortions taking place in the state were related to the 2023 rule.
“There are too many independent actors to say that actually the government’s assessment of safety is what’s causing your 1,000 abortions a month,” Higginson said.
Daniel Winik, an attorney for the U.S. Department of Justice, said the FDA’s review is still in progress.
“The whole point of our position in this case is that it’s the FDA’s job in the ongoing consideration of mifepristone to address all these issues,” Winik said.
U.S. Circuit Judge Priscilla Richman asked how many complications “would not have occurred had the woman seen a physician in person.”
Attorneys for mifepristone makers GenBioPro and Danco have said the drug is safe and that the FDA appropriately considered the drug’s risks when making its decision in 2023.
“The FDA’s decision was richly supported,” GenBioPro lawyer John Elwood told the panel.
The UAE is redrawing its plans for a five-gigawatt artificial intelligence (AI) data center project, one of the largest anywhere outside the US, after Iranian retaliatory strikes on infrastructure across the Gulf forced the Emirates to rethink how and where critical facilities are built, Reutersreported on Friday.
Speaking in anonymity, six people familiar with the matter told Reuters that Emirati authorities began reassessing where and how sensitive facilities should be built once the war reached the Gulf.
Four of those sources said the campus, first designed as a single 26-square-kilometer site in Abu Dhabi, is now expected to take shape as several data centers distributed across the country.
Authorities are weighing ways to shield the facilities from drone and missile strikes, the sources said, including installing air defenses and putting some of the centers underground.
Sources also said interceptors and electronic jamming equipment are being written into the redesign, with blast-resistant concrete and additional backup power and cooling systems also under consideration, and with the most sensitive material, including military data, possibly housed inside mountains.
Iran began striking Gulf states hosting US forces with missiles and drones in response to US and Israeli airstrikes on Iranian territory. Two Amazon Web Services data centers in the UAE and one in Bahrain were damaged in March, and the company’s regional cloud services remain disrupted.
In April, the Iranian armed forces released a video naming Stargate UAE, the $30 billion, one-gigawatt first phase of the campus, as a potential target for retaliatory strikes, showing a map of the site alongside the caption “Nothing stays hidden from our sight.”
Stargate UAE is shaping up to be the fastest AI data center buildout in the world with 5GW of total planned capacity. pic.twitter.com/tXsFxfJgTb
Daniel Benaim, a former US deputy assistant secretary of state for Arabian Peninsula affairs, called the war an “economic earthquake” for Gulf states that had spent years selling themselves as safe havens, adding that hardening critical infrastructure was now vitally necessary.
Data centers have moved from commercial facilities into the category of critical infrastructure, processing financial flows, sustaining public services, and feeding into military communications and intelligence work.
Oprah Winfrey flew into Massachusetts to host a “watershed” conversation about Lindsay Clancy.
What the cameras captured was not a sombre conversation regarding her three dead children. It was a room brainwashed into treating a child-killer as a ideological cause – and then demand the same energy for black women who have murdered their kids.
Yes really. The takeaway from this particular creepy corner of culture is no longer “killing your children is unthinkable.” Rather, it is “lets make sure we support child killers of color just as much as white child killers.”
As we now know, Clancy strangled her three children – 5-year-old Cora, 3-year-old Dawson and 8-month-old Callan – with exercise bands in the family basement on January 24, 2023, then cut herself and jumped from a second-story window. She has never denied the killings. Her defense argued postpartum psychosis and a lack of criminal responsibility. Prosecutors said the acts were planned. After 21 days of testimony and more than 80 witnesses, the jury hung. A mistrial was declared in early September.
Days later Oprah’s podcast put the case on a soundstage with medical experts, legal voices, a former colleague who testified at trial, and women describing their own postpartum breakdowns. Official branding called it “Understanding Postpartum Psychosis.” The clip that detonated online was something else entirely.
A doctor in the room told the audience she wanted the same passion for women “who don’t look like Lindsay.”
Okaaaaaay. “Passion”?
“I want us to have the same passion for people who don’t look like Lindsay, who don’t have her same access… who don’t have her same access and education, her melanin, her privilege,” she said.
Right, you can see where this is going.
“There are women of color sitting around this country in prisons for this same thing that we’ve never heard of. And I just want to remind us to have the pink shirts and the energy for them as well.”
The room cheered.
Room full of women on the Oprah show starts cheering after a doctor says that black female child murderers need to be supported too, not just the white child murderers like Lindsay Clancy.
“I want us to have the same passion for [female child murderers] who don’t look like… pic.twitter.com/VbaQfq9BYi
The moral argument slid, in one breath, from mental-health treatment to racial bookkeeping for filicide. Not “stop this.” Not “the children come first.” The demand was representation – pink shirts and energy for other mothers who killed their kids.
Once the killer is recast as the victim, the next move is to complain that some victims of this new compassion have the wrong skin tone.
AND OF COURSE they’re trying to make child murder”more racially inclusive” now.
If you tried to write the darkest possible parody of this movement, I don’t think you could do much better than “it’s important to support child-stranglers of color” https://t.co/S0a48D8gLi
Belief that a mother who strangled three small children is a murderer was treated as a failure to absorb the program. The safe answer in that room was not the names Cora, Dawson and Callan. It was the sermon: hormones, sleep, the medical system, “access,” “melanin,” “privilege.”
Mothers are supposed to be the safest place for children. That used to be the one thing that did not require a panel debate.
The rest of the taping ran on the same track: identification with Clancy, regardless of the murdered children.
One woman described hearing a man’s voice whispering in her ear to drown her baby. The camera found tears on cue.
In an effort to sympathize with Lindsay Clancy, woman who says she had postpartum depression says she heard the voice of a man whispering in her ear to drown her baby.
Another told Oprah she sat in her son’s bedroom and saw his toys as weapons. She played out strangling him in her mind. When Clancy’s case hit the news, she said she recognized the same intrusive thoughts. “The reason my story ended differently is because who my husband is,” she stated.
Oprah told her she had “a lot of courage.”
Oprah:
You have a lot of courage.
Woman:
Before I was hospitalized— I sat in my son’s bedroom and I saw all of their toys as weapons. I played out in my mind me strangling my son.
A third guest said she began hearing voices telling her that her daughter was the second coming of Christ and that she wanted to rewrite the Bible. She said she improved after 17 days in a hospital. The point of the story, in that room, was kinship with Clancy.
This woman tells Oprah she sympathizes with Lindsay Clancy because she started hearing voices telling her that her daughter was the second coming of Christ and she wanted to rewrite the Bible… and she got better after being hospitalized for 17 days https://t.co/WLp1iQywHIpic.twitter.com/vVuNyDhc9y
An ‘expert’ then offered “Society expects women to be perfect. So what are we supposed to do? This bliss-myth of what it is to be a mother is so society engrained, it’s very hard to ask for help.”
Expert defends Lindsay Clancy:
“Society expects women to be perfect. So what are we supposed to do?
Most mothers have been exhausted. Most mothers have not treated their children as a problem to be solved with an exercise band.
Ladies… I’m listening to this thing Oprah hosted and it is absolutely scary insane to me— the common theme they’re trying to push is that hormones and sleep deprecation is a justifiable reason for women to murder their children.
The pink-shirt movement formed outside Plymouth Superior Court. In mid-August, hundreds of women in pink treated Clancy’s van like a homecoming. Organizer Renee Kimball said, “I think that every one of us women believe that it could be any one of us.” She added that women who have dealt with anxiety, depression and postpartum “just know that any one of us could be sitting in her chair.”
Days earlier the same scene was already apparent online: TikTok mothers filming themselves relating to a confessed child-killer while holding their own babies, a GoFundMe for Clancy’s parents swelling toward seven figures, and comment threads that talked more about her treatment than about the murdered kids.
Bill Maher, no MAGA activist, asked the question the pink crowd still will not. “What I don’t get is why does she have fans?” He compared the courthouse scene to the folk-hero treatment of Luigi Mangione. He could grant that postpartum illness is real. He could not explain the merch, the cheers, or the need for a fandom.
Joe Rogan was less delicate. “If those ladies could see the crime scene and see those dead kids with their vacant eyes staring up because their mother took their life, the last thing that they saw was their mother standing over them, choking them to death, I don’t think they would feel so bad.” He added that if she walks, “her supporters should have to let her babysit.”
Prosecutors in Frankfort, Illinois, say Corie Walsh hanged her 2-year-old son, Barrett, from a basement rafter, then tried to kill herself. She told police the boy was the “devil” and the “anti-Christ.” Witnesses said she had become “very invested” in the Clancy trial and was still texting friends about it hours before the child was found.
Meanwhile the living victim of the original crime – Patrick Clancy, the father who came home to three dead children – has been hunted online by the same ecosystem. His attorney, Howard Cooper, said Patrick and his family have been “subjected to a relentless, escalating and destructive defamation campaign” from “minor celebrities, so-called influencers and outright conspiracy theorists.” Cooper’s demand was simple: “Enough is enough – this spread of blatant and baseless falsehoods must stop.”
Lindsay confessed. Nobody in the courtroom argued Patrick did it. The pink movement needed a villain who was not the woman with the bands in her hands, so they invented one.
Plymouth County District Attorney Tim Cruz has said “This case has always been about those three children. We are here today because they are not.”
Latarsha Sanders was convicted in 2022 in the same county, before the same judge, of stabbing her sons Edson, 8, and La’son, 5, in their Brockton apartment in 2018. Prosecutors said the boys were found in bed after being stabbed roughly 100 times between them. Sanders received two mandatory life terms.
Erin Merdy of Brooklyn pleaded guilty this year to drowning her three children – Zachary, 7, Liliana, 4, and 3-month-old Oliver – in the ocean near Coney Island in 2022. Relatives had said she may have been struggling with postpartum depression. A judge sentenced her to 20 years to life. Brooklyn District Attorney Eric Gonzalez said, “No sentence can fully measure the loss of a seven-year-old, a four-year-old and a three-month-old baby, or the grief their loved ones will carry forever.”
None of this requires a studio audience to cheer a racial audit of child murder.
A movement that cannot say “do not kill your children” without attaching a demographic rider has abandoned all morality.
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“Shoulda, Coulda, Woulda”: Hillary Clinton Gives Flippant Answer When Pressed On Patriot Act Support
Hillary Clinton attempted to wave off criticism of her post-9/11 votes this week, telling a Columbia University audience that Monday-morning quarterbacking carries its own bias and that relitigating the Patriot Act does little good.
The former secretary of state, who teaches crisis decision-making at Columbia’s Institute of Global Politics, was pressed by a moderator on whether Americans were “served well” by the Patriot Act and the Authorization for Use of Military Force, and on what she remembered about the deliberations.
“I think what you just heard is such a reminder about how difficult decision-making is in the midst of a crisis,” Clinton said, speaking at a Columbia SIPA Institute of Global Politics panel titled “The 9/11 Attacks 25 Years Later: Lessons Learned, Lessons Forgotten.”
“And that’s the course that the dean and I teach every day, or every week, because hindsight is always perfect.”
“But it’s got as much bias as anything else. And so looking back and saying shoulda, coulda, woulda doesn’t really help us,” the failed presidential candidate added.
Clinton was a freshman senator from New York when hijacked airliners slammed into the World Trade Center towers in her home state. Clinton joined97 colleagues in voting for the USA Patriot Act that October. Then-Sen. Russ Feingold (D-WI) was the lone no.
Days earlier, the Senate had cleared the AUMF 98-0. Across the Capitol, Rep. Barbara Lee (D-CA) stood alone as the only member of Congress to vote against it.
That authorization became the legal blank check for roughly two decades of American military adventurism spanning multiple wars in the Middle East and multiple administrations, power lawmakers in both parties have since tried, and failed, to claw back.Gives
The Patriot Act’s Section 215, the so-called “business records” provision, became the legal foundation for the National Security Agency’s bulk collection of American phone records, a program the public learned about only in 2013 through the Edward Snowden leaks. Congress scaled it back with the USA Freedom Act in 2015. The authority finally lapsed in March 2020.
Is this a week to drain our souls, or what? Yesterday, the memory of Charlie Kirk, a decent young man known for acting nobly in an ignoble era, cut down (it is alleged in court) by a pathetic product of Woke cultism – the trans avenging angel, avatar of our national mental illness. And today, the memory of 9/11, for which no alt-theory or engineering lecture can obviate the lonely arc of those little bodies free-falling out of the flaming towers into nothingness.
So, we move on because there is nothing else you can do, really. . . sad, furious, or what. . . and then do what you can to fix this joint. If this was a house in a storm, you’d be hearing the joists groan and the rafters squeak as they torque out of true, like just before the whole shootin’ match goes down. Meanwhile, news is out that Joe DiGenova, the former DC federal attorney supervising the grand jury action in Florida concerning RussiaGate and associated treasons, is out. He said he “resigned.” That’s usually a cover. Somebody gave him the boot, and it was either Todd Blanche or President Trump. Cuz, why? I suppose we’ll find out.
Trollish insinuations are flying in the usual channels that he couldn’t get enough evidence to bring any proper cases, but I don’t believe that for a horse-face Hochul’s New York minute, nor that Mr. DiGenova actually said anything like that. Anyway, at least twenty million civilians ‘out there’ have been following this constitutional death dance closely for years. We know the names, the acts, the memos, the emails, the money trails, the dots and the receipts by heart. Many can even recite long legal memoranda on the likes of John Brennan, Adam Schiff, Jim Comey, Hillary, Strzok, Page, blah blah, dates, times, document numbers.
Joe DiGenova is old, others say. Not a good organizer, turns out. . . not a good team leader. . . things like that. Well, maybe his force of personality or renowned avidity to correct epic insults to the nation concealed all that. Anyway, he was brought in to replace a federal attorney name of Maria Medetis Long, and I bet none of you even know her name. She was on the case down there in Florida during Pam Bondi’s unfortunate commission, too blah even to go down in infamy. To the casual observer, the whole wicked business begins to look like a Chinese fire drill.
Or possibly a circle-jerk. And, of course, everybody is wondering: what’s the blast radius on this one? Can the DOJ’s Southern District of Florida recover some kind of equipoise and carry on and usher this pretty large troupe of scoundrels into courts of law? Or is folding like a Broadway tryout in New Haven? Does it now all get sucked into some vortex of lost causes? And wouldn’t that be demoralizing?
My guess: these acts against the country and its people are too grave, too important, to just go away, and won’t go away. What the diGenova fumble seems to point to is that persons and parties behind that treason – and you might suppose I’m thinking: the Intel (so-called) “community” and its many-footed ancillaries – are both desperate and powerful enough to try to derail the process. Just imagine how many retired Intel rogues are out there after seventy-plus years of, say, the CIA alone. Must be a lot of them, including the fifty-one ex-Intel bigshots who signed the Hunter Biden laptop public letter in 2020 to queer the election.
You’ve got to wonder whether the agency that John Ratcliffe is supposedly in charge of has an equally large shadow org of these people, perhaps operating under the likes of one ex-CIA honcho John Brennan. And then you have to wonder what machinery of government they’ve still got their mitts on? Or maybe they just put the word out that pursuing any just resolution of the traitorous trips laid on America by them could be bad for anyone’s health. In any case, I don’t hesitate to point out that the legions of ex-spooks and their bag-men all have names and records and. . . well. . . apply a little Anthropic hocus-pocus. . . we’ll know where you live and what you had for breakfast before the ten a.m. break.
What I’m getting at – and I regret even having to affect coyness – is that the departure of Joe diGenova could signify some Battle of the Titans, a civil war not on the ground between plain citizens too bamboozled by sexual hysteria to put up a fight, but between the general officer ranks of two opposing elite dominions, the legitimate and the shadow, the light and the dark.
The action won’t stay backstage for long. Barbarians really are at the gate, and that gate is the midterm election. America has gone so crazy that it doesn’t seem to even recognize how crazy many of the candidates for high office are. The shadow dominion appears to be behind them, too: Telarico, el-Sayed, Peggy Flanagan, Becerra, Hochul. . . Lord have mercy! These are not just not-normal people. They are outright sickies, working hard to wreck the country.
Well, Labor Day is gone and the blandishments of summer with it. Time to stop sulking. All hands on deck. The bell has rung.
The fact that China has a large quantity of gold in its official reserve position is not news. China’s gold reserves have been rising substantially since 2009.
At that time, China’s official gold reserves were 1,054 metric tonnes (mt). Today, those reserves stand at approximately 2,366 mt, an increase of about 124%. But that does not tell the whole story.
The official reserves are reported by the People’s Bank of China (PBOC), the Chinese central bank. But China may also hold gold through other state entities, including the State Administration of Foreign Exchange (SAFE). China is non-transparent about the full extent of its gold holdings. The exact amount of any unreported gold is unknown. Estimates can be formed based on imports from Switzerland via Hong Kong, but those are inexact.
One estimate is that the amount of “hidden gold” held by Chinese state entities is approximately the same as the amount reported publicly by the PBOC. If that estimate is correct, total Chinese gold reserves would be about 4,700 mt, or roughly 58% of U.S. gold reserves of 8,133 mt.
That would make China the second-largest sovereign gold holder in the world after the U.S. and put China ahead of gold powers such as Germany, Italy and France. Still, caution is warranted. Actual official gold holdings in China could be higher or lower than that estimate.
Both the publicly reported gold reserves of PBOC and any hidden state gold reserves are in addition to the amount of privately held gold in China. That figure is even more difficult to estimate. It is widely reported that Indian citizens privately own substantial quantities of gold, with estimates often running into the tens of thousands of tonnes.
China has a population about the same size as India and an equally strong cultural affinity for gold bullion. An estimate of perhaps 10,000 metric tonnes of gold held privately by Chinese citizens seems reasonable, although it cannot be verified precisely.
By any measure, China is a gold powerhouse, even if its reported official holdings still fall short of those of the U.S. But what is China doing with its gold? What is the point of massive gold accumulation by the Chinese government and its people?
The Gold-Backed Yuan Is a Chimera
One thing that is not happening is the creation of a gold-backed Chinese yuan. China may have an enormous amount of gold, but China has an even larger money supply than the U.S. and an enormous debt burden once provincial debt issuance is taken into account.
Traditionally, gold holdings must be between 20% and 40% of the money supply to engender trust in a gold-backed currency system. China’s reported gold holdings are in the low single digits as a percentage of money supply. In my view, there will be no gold-backed yuan for the foreseeable future.
The idea that the Chinese yuan, whether gold-backed or not, can replace the U.S. dollar as the global reserve currency is also nonsense. Official foreign exchange reserves are not simply piles of currency. They are held largely as securities and deposits denominated in a currency. These securities are typically government bonds but can include other assets, depending on the country.
In short, you cannot be considered a major reserve currency unless you have financial markets large enough to absorb global official savings.
A bond market requires underwriters, called “primary dealers” in the U.S., a range of maturities, regular auctions, hedging instruments such as futures, options and when-issued trading, a large pool of institutional buyers and, above all, a strong rule of law.
China has a large bond market, but it lacks the depth, openness, convertibility and legal protections needed to rival the U.S. Treasury market as the foundation of the global reserve system. It will take years to build a system that does. China is simply not in the same league when it comes to reserve-currency status, with or without gold.
The latest IMF data show that the U.S. dollar accounts for about 57% of global foreign exchange reserves. The euro accounts for about 20%.
That leaves all other currencies to share the remaining 23%, with significant portions taken up by Japanese and U.K. securities, along with Australian and Canadian dollars and Swiss francs. The Chinese share is about 2%.
If a gold-backed yuan is a chimera and the yuan as a dominant reserve currency is a nonstarter due to the limitations of its financial markets, why is China buying so much gold? What is the real plan?
Follow the Gold, Not the Yuan
To understand China’s gold acquisitions, we need to look at what else China is doing in the gold market.
Major Chinese banks have recently moved to suspend or restrict individual trading in precious metals linked to the Shanghai Gold Exchange. This was presented as a risk-reducing measure. The restrictions do not prohibit physical gold purchases or ownership through gold funds by everyday Chinese citizens.
In effect, China is curbing certain forms of retail “paper gold” trading while allowing accumulation of physical gold. That’s an amplification of trends already in place.
Hong Kong also launched a new central clearing and settlement system for gold in July 2026. Hong Kong has a better rule of law than mainland China, although it is firmly under the control of the Chinese Communist Party.
This arrangement gives China greater flexibility to develop gold trading and settlement outside the traditional dollar-dominated system. That result is not the same as a gold-backed yuan, but it does lessen China’s dependence on dollar-denominated payment systems with regard to gold.
China also changed its insurance regulations to allow ten major insurance companies to invest in gold, with exposure capped at 1% of total assets. Given the size of the Chinese insurance market, even 1% represents a potentially major increase in demand for gold.
Hong Kong is also expanding its physical storage capacity, with a target of over 2,000 metric tonnes within three years. That would make it one of the world’s major gold storage centers, although the target has not yet been reached.
China’s Golden Escape Hatch
Taken together, these measures show that China – already the largest gold producer in the world based on its mining operations – is building more than a massive gold reserve.
It is positioning itself as a global gold trading center, with infrastructure for investment, retail accumulation, hedging, imports, settlement, clearing and storage.
China is not troubled by the decline in the dollar price of gold between January 2026 and today. The reason is that China is in acquisition mode.
In my view, Chinese policymakers expect the price of gold to soar sooner rather than later. Any buyer accumulating gold favors a lower price for the time being because it means getting more gold for every dollar spent.
The payoff comes later if the dollar price of gold spikes higher. Whoever has the most gold then is the biggest winner.
All of this dollar price action really says more about dollar volatility than it does about gold. That’s one more reason to get out of dollars and into physical gold.
China is looking ahead to the day when a confrontation with the United States could force it to separate from the dollar payments system entirely in order to avoid asset freezes and financial sanctions.
Chinese policymakers are watching the financial sanctions that the U.S. is imposing on Russia and Iran and drawing the appropriate lessons.
China’s solution to geopolitical chaos and financial warfare is to buy physical gold. Investors in the U.S. are well advised to take the same approach.
US 2026 Budget Deficit Hits $1.97 Trillion With One Month Left; Interest At Record $1.4 Trillion
With DOGE disbanded more than a year ago, and tariffs struck down by the Supreme Court, the US is no longer even pretending that there is any hope to normalize spending, or any kind of happy ending to the US debt trajectory.
Total US receipts were $360 billion, a modest improvement from the $344 billion a year ago, with individual income taxes accounting for $179 billion, or half of the total, and the bulk of the balance coming from Social Insurance and Retirement receipts of $141 billion.
On the spending side, things were ugly: total outlays were $527 billion, a modest improvement to the $689.1 billion a year ago, but much of that had to do with the calendar impact of tariffs.
Putting receipts and spending in context, a chart of the trailing 6 months of government revenue and spending shows that the two trendlines are rapidly diverging, with spending on pace to surpass the covid all time high, even as government revenue remains stuck in a much more narrow range.
The difference between the two, is of course, the US budget deficit, which in August was $166.8 billion, an improvement from July’s massive $432 billion deficit, which however was the result of some calendar discrepancies between the two months. What matters more is that fir the first 11 months of fiscal 2026 (with just one month left in the fiscal year), the total US deficit is now $1.97 trillion, identical with last year, although since 2025 saw a big drop in the final month of the year, we are confident that 2026 will be about $200bn worse than the previous year when all is said and done, and be the 3rd worst year for the US deficit on record, with just the crisis years of 2020 and 2021 worse.
Finally, turning to the elephant in the room, namely interest expense, in August the US spent $98 billion on gross interest expense, which means that with 1 month left in fiscal 2026, total US interest spending is now $1.267 trillion, up 12% from a year ago…
… while on an LTM basis, it is now a record $1.4 trillion, and is set to surpass Social Security (which was $1.66 trillion LTM but growing much slower), by the end of 2028.
And since 23% of marketable US debt is now T-Bills, which will see an immediate impact from any Fed hikes, the moments the Fed raises rates, US interest expense is going to rise even more sharply, signaling that while the debt endgame for the US is guaranteed, the only question is whether Warsh will bring it on even faster.
Crude oil prices are poised for further increases and the trending trajectory is higher, as global inventory drawdowns have accelerated and China is back to buying significantly higher crude oil volumes than in the spring, Energy Aspects founder and market intelligence director, Amrita Sen, told CNBC on Friday.
The intensified shipping risks in the Middle East with tanker attacks in the Strait of Hormuz and the Houthi threat in the Red Sea are hampering crude oil supply to Asian refiners. If Hormuz cancellations and delays persist, the only option for Asian refiners is to reduce runs, Sen said.
Following an uptick in Strait of Hormuz oil flows in August, shippers are now cautious again amid the re-escalation of hostilities, the oil market expert told CNBC.
The oil market has reached the “inflection point” and is heading for an “upward spiral” between crude and products, Sen noted.
Earlier this week, Sen told Bloomberg in an interview that China is estimated to import about 10 million barrels per day (bpd) of crude this month. The expected volume in September would be about 3 million bpd higher than in June, when China’s crude oil imports slumped to below 7 million bpd to a decade-low.
The return of China to crude buying and the accelerating inventory drawdowns are also pushing crude oil prices higher, apart from the headlines and U.S. and Iran rhetoric.
In the past two weeks alone, a total of 120 million barrels of oil were drawn down from inventories globally, Sen told Bloomberg.
All these factors are driving crude oil prices toward a “significant leg higher,” the market expert said on Wednesday, the day on which oil prices jumped above $100 per barrel for the first time since July.
Oil prices were on track early on Friday to end a trading week above the $100 a barrel mark for the first time since May.
